"Services Used in Export Product Production Lowest in Korea Among Top 5 Countries"

Martial Arts, 'The Future of Manufacturing <1>: Enhancing the Status of the Service Industry as Intermediate Goods and Implications' Presentation
"Service Utilization as Intermediate Goods Must Be Increased"

Photo by Yonhap News

[Asia Economy Reporter Han Yeju] There is a growing argument that the convergence between domestic service and manufacturing industries should be promoted to increase the utilization of services as intermediate goods.

The Korea International Trade Association (KITA) International Trade and Commerce Research Institute announced this on the 21st in a report titled "The Future of Manufacturing <1>: Enhancing the Status of the Service Industry as Intermediate Goods and Implications."

According to the report, the value-added creation power of service exports appears to be higher than that of manufacturing exports, indicating that the importance of the service industry in the global value chain (GVC) has further increased.

In particular, as the role of services as intermediate goods in the production of export goods is growing, convergence between services and manufacturing seems necessary to strengthen manufacturing export competitiveness in the future.

However, the proportion of domestic and overseas services input in the production process of export goods in the five major manufacturing countries (Germany, China, the United States, Japan, and Korea) was found to be the lowest in Korea at 27.9%.

Korea shows relatively insufficient convergence between domestic services and manufacturing compared to the convergence between overseas services and manufacturing, indicating the need to increase the utilization of services as intermediate goods and strengthen the competitiveness of the domestic service industry.

Senior Researcher Kang Naeyeong of the Trade Association analyzed, "The innovation in manufacturing in major advanced countries is expected to have a significant impact on domestic manufacturing in the future," adding, "Domestic manufacturers need efforts such as discovering innovative services and the servitization of manufacturing."

This content was produced with the assistance of AI translation services.